Exhibit 10(a)(xv)
H. J. HEINZ COMPANY
EXECUTIVE ESTATE LIFE INSURANCE PROGRAM
1. PURPOSE
The purpose of the H. J. Heinz Company Executive Estate Life Insurance
Program ("EELIP") is to provide Eligible Executives of H. J. Heinz
Company (the "Company") the opportunity to forego existing deferred
compensation balances under the H. J. Heinz Company Executive Deferred
Compensation Plan (the "Deferred Compensation Plan") in exchange for
the Company's funding of the purchase of a life insurance policy by the
Eligible Executive's family trust.
2. DEFINITIONS
For purposes of the EELIP, the following terms have the meanings set
forth below:
2.01 AGREEMENT TO FOREGO COMPENSATION means the form used by a
Participant to make an election to forego Compensation
pursuant to Section 3.02 of the EELIP and to participate in
the EELIP.
2.02 BOARD OF DIRECTORS means the Board of Directors of the
Company.
2.03 CHANGE OF CONTROL means a change of control of the Company, as
such term is defined in Section 1(b) of the H. J. Heinz
Company 2000 Stock Option Plan, as amended from time to time.
2.04 COMMITTEE means the Management Development & Compensation
Committee of the Board of Directors of H. J. Heinz Company.
2.05 COMPANY means H. J. Heinz Company and any of its subsidiaries
and affiliates.
2.06 COMPENSATION means amounts a Participant agrees to forego to
participate in the EELIP pursuant to Section 3, and shall
include existing deferred compensation balances under the H.
J. Heinz Company Executive Deferred Compensation Plan.
2.07 EELIP ADMINISTRATOR means the Committee, or its designee.
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2.08 EFFECTIVE DATE means December 27, 2001.
2.09 ELIGIBLE EXECUTIVE means any executive of the Company
designated in writing by the Committee to be an Eligible
Executive, and therefore eligible to participate in the EELIP.
2.10 INSURER means, with respect to a Participant's Policy, the
insurance company issuing the Policy on the Participant's life
(or on the lives of the Participant and the Participant's
spouse, in the case of a Survivorship Policy) pursuant to the
provisions of the Promissory Note and the EELIP.
2.11 PARTICIPANT means an Eligible Executive who elects to
participate in the EELIP.
2.12 POLICY means the life insurance coverage acquired on the life
of the Participant (or on the lives of the Participant and the
Participant's spouse, in the case of a Survivorship Policy)
pursuant to the EELIP.
2.13 PROMISSORY NOTE means the document executed by the Company and
the Participant's trust as provided in Section 4.
2.14 SURVIVORSHIP POLICY means a Policy insuring the lives of the
Participant and a Participant's spouse, with the death benefit
payable at the death of the last survivor of the Participant
and his or her spouse.
3. PARTICIPATION
3.01 ELIGIBILITY. Any Eligible Executive shall be eligible to
participate in the EELIP. An Eligible Executive shall become a
Participant by completing such forms, documents and procedures
as specified by the EELIP Administrator. The Participant (and,
in the case of a Survivorship Policy, the Participant's
spouse) shall cooperate with the Insurer by furnishing any and
all information requested by the Insurer in order to
facilitate the issuance of the Policy, including furnishing
such medical information and taking such physical examinations
as the Insurer may deem necessary. In the absence of such
cooperation, the Company shall have no further obligation to
the Participant to allow him or her to participate in the
EELIP.
3.02 ELECTION TO FOREGO COMPENSATION. As a condition of
participating in the EELIP, each Participant shall be required
to make an election in which
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the Participant shall commit to forego the receipt of a
specified amount of Compensation. The Participant shall make
an election to forego Compensation by execution of an
Agreement to Forego Compensation prior to the Policy effective
date. The amounts that a Participant agrees to forego pursuant
to such election, unless precluded by tax or other laws to the
contrary, shall be included in determining a Participant's
compensation for purposes of any benefit plans maintained by
the Company to the same extent as if such Compensation had
been paid to the Eligible Executive at the time the Eligible
Executive agrees to forego such Compensation and shall be
valued as of the date the Agreement to Forego Compensation is
completed by the Eligible Executive and submitted to the
Company; provided, however, that any such amounts which are
not fully vested at the time the Eligible Executive agrees to
forego such Compensation shall be so included at the time they
become fully vested and shall be valued in such case as of the
date the Agreement to Forego Compensation is completed by the
Eligible Executive and submitted to the Company.
An Eligible Executive's election to participate in the EELIP
shall be irrevocable when the Eligible Executive completes an
Agreement to Forego Compensation and submits it to the
Company.
4. GENERAL DESCRIPTION
The Company shall fund a trust created by the Participant, in an amount
equal to approximately one hundred and fifty percent (150%), or such
other amount as determined by the Committee in its sole discretion, of
the value of the Compensation foregone by a Participant as provided in
the Agreement to Forego Compensation. The terms of the funding shall be
documented by a Promissory Note to be executed by the Company and the
trust. The Promissory Note will provide as follows:
a. The interest rate shall be the long term Applicable Federal
Rate ("AFR") required pursuant to the Internal Revenue Code in
effect at the time of funding to avoid below market treatment
under section 7872 of the Internal Revenue Code, or such other
rate as determined by the EELIP Administrator.
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b. The proceeds must be used to pay a premium on a life insurance
policy on the life of the Participant (or a Survivorship
policy on the life of the Participant and the Participant's
spouse) and no part of the proceeds shall be used for any
other purpose.
c. The Promissory Note is due and payable within 90 days
following the death of the insured(s) under the policy.
d. The Policy will be owned solely by the trust created by the
Participant and the trust must be designated as beneficiary to
receive the Policy death benefit or any benefit paid at Policy
maturity, and no person or entity will have any interest in
the Policy.
e. The entire principal sum and accrued interest under the
Promissory Note shall become immediately due and payable if:
(i) the trust fails to pay the Policy premium within the time
allowed under the Promissory Note; (ii) the trust attempts to
transfer all or any part of its interest in the Policy to any
party other than a successor trustee; (iii) the trust
surrenders the Policy in whole or in part, or borrows from,
withdraws cash value from, or otherwise pledges or encumbers
the Policy; (iv) the trust reduces the face amount of the
Policy without the consent of the Company, but only if the
face amount reduction results in a distribution of Policy cash
values; or (v) the Participant terminates employment with the
Company before any applicable vesting date, unless: (A) such
termination of employment occurs as a result of the
Participant's death; (B) such termination of employment occurs
as a result of the Participant's total disability; (C) such
termination of employment occurs as a result of or following a
Change of Control; (D) such termination of employment occurs
as a result of the Participant's retirement under any
retirement plan of the Company or a subsidiary (as such term
is defined in Section 5.4(a) of the H. J. Heinz Company
Executive Deferred Compensation Plan, as amended from time to
time) of the Company; or (E) such termination of employment
constitutes an involuntary termination of employment without
cause. For purposes of subparagraph (B) above, "total
disability" shall be determined as defined in the Company's
Long-Term Disability Plan, and the determination of the
existence of "total disability" shall be made by the
Committee, and such determination by the Committee shall be
final. For purposes of subparagraph (D) above, the
determination of the existence
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of "retirement" shall be made by the Committee and such
determination by the Committee shall be final. For purposes of
subparagraph (E) above, "cause" shall mean an act of
dishonesty, moral turpitude or an intentional or grossly
negligent act detrimental to the best interests of the Company
or a subsidiary (as such term is defined in Section 5.4(a) of
the H. J. Heinz Company Executive Deferred Compensation Plan,
as amended from time to time) of the Company.
f. Such other provisions as shall be determined by the EELIP
Administrator.
5. EELIP ADMINISTRATION, AMENDMENT AND TERMINATION
5.01 EELIP ADMINISTRATION. The EELIP shall be administered by the
EELIP Administrator or its designee. The EELIP Administrator
shall have the full and exclusive authority to interpret,
administer and modify the EELIP (including fact-based
determinations), to construe ambiguities and to decide all
matters under the EELIP in its sole discretion. Such
interpretation and decision by the EELIP Administrator (or its
designee) with respect to any question arising out of or in
connection with the administration, interpretation and
application of the EELIP shall be final, conclusive and
binding on all Participants and any person claiming under or
through any Participant. The EELIP Administrator shall have
full discretionary authority to make any and all rules,
regulations and determinations, whether or not specifically
authorized herein, as it deems necessary or appropriate to
carry out its responsibilities under the EELIP as well as the
purposes for which it was established. In the administration
of the EELIP, the EELIP Administrator from time to time may
employ agents and delegate to them or to others (including
Eligible Executives) such administrative duties as it sees
fit. The EELIP Administrator from time to time may consult
with counsel, who may be counsel to the Company. The Company
shall indemnify and hold harmless the EELIP Administrator and
any Eligible Executives to whom administrative duties under
the EELIP are delegated, against any and all claims, loss,
damage, expense or liability arising from any action or
failure to act with respect to the EELIP, except in the case
of gross negligence or willful misconduct by the EELIP
Administrator.
5.02 EELIP AMENDMENT AND TERMINATION. The Committee may amend,
modify or terminate the EELIP at any time, but any such
amendment,
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modification or termination will not affect the rights of any
Participant, under any Agreement to Forego Compensation or
Promissory Note entered into with the Company prior to the
date of such amendment, modification or termination without
the Participant's written consent.
5.03 SUCCESSORS. The terms and conditions of the EELIP shall inure
to the benefit of and bind the Company, the Participant and
the trust, as well as their successors, assignees and
representatives. The Company shall have the right to
absolutely and irrevocably assign its rights, title and
interest in a Promissory Note without the consent of the
Participant or trust (or permissible assignee).
6. CLAIMS PROCEDURE
The EELIP Administrator shall establish a claims procedure
that is designed to provide adequate notice in writing to any
Participant or beneficiary whose claim for benefits under the
EELIP has been denied, setting forth the specific reasons for
such denial and written in a manner calculated to be
understood by the Participant, and such procedure shall afford
a reasonable opportunity to any Participant whose claim for
benefits has been denied to have a full and fair review of the
decision denying the claim.
7. GOVERNING LAWS AND NOTICES
7.01 GOVERNING LAW. The EELIP shall be governed by and construed in
accordance with the substantive law of the Commonwealth of
Pennsylvania, without giving effect to the choice of law rules
of the Commonwealth of Pennsylvania.
7.02 NOTICES. All notices hereunder shall be in writing and sent by
first class mail with postage prepaid. Any notice to the
Company shall be addressed to the attention of either the Vice
President - Human Resources or General Counsel at the
principal office of the Company at 600 Grant Street,
Pittsburgh, PA 15219. Any notice to the Participant shall be
addressed to the Participant at the last known address on file
with the Company. Any party may change its address by giving
written notice of such change to the other party pursuant to
this Section.
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8. MISCELLANEOUS PROVISIONS
8.01 NO CONTRACT OF EMPLOYMENT. This EELIP, and any Agreement to
Forego Compensation or Promissory Note executed hereunder,
shall not be deemed to constitute a contract of employment
between an Eligible Executive and the Company, or a
Participant and the Company, nor shall any provision restrict
the right of the Company to discharge an Eligible Executive or
Participant, or restrict the right of an Eligible Executive or
Participant to terminate employment with the Company.
8.02 GENDER. The masculine pronoun includes the feminine and the
singular includes the plural where appropriate for valid
construction.
8.03 COOPERATION WITH INSURER. In order to be eligible to
participate in the EELIP, the Participant (and, in the case of
a Survivorship Policy, the Participant's spouse) shall
cooperate with the Insurer by furnishing any and all
information requested by the Insurer in order to facilitate
the issuance of the policy, including furnishing such medical
information and taking such physical examinations as the
Insurer may deem necessary. In the absence of such
cooperation, the Company shall have no further obligation to
the Participant to allow him or her to participate in the
EELIP.
8.04 INCONSISTENT TERMS. In the event of any inconsistency between
the terms of the EELIP as described herein and the terms of
any Policy purchased hereunder or any related Agreement to
Forego Compensation or Promissory Note, the terms of such
Policy or Agreement to Forego Compensation or Promissory Note
shall be controlling as to that Participant or his or her
trust.
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